This is the second part in a two part series that documents Tim and Catherine’s struggle to survive Tim’s back to back unemployment. You can read part one here.
About two years before Tim lost his first job, they were struggling with making their house payment because they had an adjustable rate mortgage that continued to creep up and Tim, who operated almost entirely on commission, earned less than half of his typical salary as the economy slowed and sales dried up. Catherine happened to be watching The Oprah Show when Suze Orman was on. Suze Orman explained how homeowners struggling with job loss or lower income could still keep their homes. Catherine took the advice to heart and called the number Suze Orman gave out, which was for a home modification The paperwork took one year to complete, and after they were accepted to the program, they had to prove they could make their house payments on time for one year. Yet, at the end of the two year process, Tim and Catherine ended up with a 2.65 interest rate on their loan which dropped their monthly mortgage payment by $1,000 a month and saved them from losing their house or having to sell when Tim lost his job just a few months later.
Meanwhile, the months of unemployment stretched and both Tim and Catherine, already frugal by nature, learned how to survive on a monthly income they previously didn’t think they could survive on and sustain themselves and their four children.
Catherine applied for and was accepted to the LINK program (the equivalent of food stamps). She was shocked to see that her family was to receive $900 a month for food because she hadn’t spent that much before when Tim was employed. Still, she stocked up her empty cupboards trying to stretch the dollars.
She cooked simple, homemade meals and always shopped the perimeter of the store, buying the basics such as milk, meat, fruits and vegetables. Although they hadn’t bought much processed food before, they eliminated it completely. She also started a small garden in her back yard and learned to stock up when staples went on sale. She cut back on her family’s consumption of oils, butter and bread.
Catherine is originally from Ireland, and she decided to try a new trick. In Ireland and many European countries, people shop daily for the things they need for that day’s meals. Catherine started this habit again; she brought only one cloth bag with her to the grocery store and told herself when that bag was filled, she needed to stop shopping and go home. This strategy worked so well, she now grocery shops like this a few times a week.
Meanwhile, she learned and implemented other money saving strategies:
-Patch up or alter clothes rather than buying new ones.
-Turn down the heat as low as the family can stand it and wear sweaters during the day and use lots of extra blankets at night.
-Cancel newspaper subscriptions and cable T.V.
-Consider extras a treat. The family NEVER ate out at a restaurant. When their older children had birthdays, Tim and Catherine would give them some money to eat out with a few of their friends, but the whole family did not go.
-Use bar soap instead of liquid soap
-Switch to cloth towels instead of paper towels
-Hang clothes on the line rather than running the dryer.
-Never use plastic bottles; instead use metal portable containers for water
-Buy chicken whole and use it to make two or three different meals plus stock from the bones and extras
Finally, 17 months after he was initially laid off from the second job, Tim began a new job as a regional manager, which he still works at today. He travels frequently around the country as part of his job, and he truly enjoys it. Meanwhile, Catherine finds that even though they have recovered from the period of unemployment, their lifestyle hasn’t changed much. The changes that they made to survive have become permanent changes. Going back to some of their old habits just seems wasteful to her.
They are still working to shore up their emergency fund, which they had to use to make their monthly mortgage payments. Tim also had to take a loan from his life insurance policy, and he will be paying that back for years.
However, in addition to learning new habits, Tim’s unemployment also had a surprising upside. Two of their children graduated high school during their economic difficulties, so they both qualified for ample scholarships to the colleges of their choice. Her oldest child got a full scholarship, and her second oldest got a partial scholarship. He does have to take out a student loan, but it is much less than it would have been. Meanwhile, Catherine continues to work at both of her part-time jobs, and she has recently been taking college classes part-time (and earning A’s). She plans to go to nursing school.
Reflecting on the difficulties her family faced, Catherine advises others who are stuck in unemployment to “Get outside of your depression and look at unemployment as a time of opportunity. Change your mind set.” She admits it is very difficult to do, but for her husband, it made all of the difference.